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What Is Dropshipping & How Do You Get Started?
Understanding dropshipping and steps to launch your own online business
May 2, 2024
16 min read
Dropshipping is a scam. This is what people with a lack of entrepreneurial experience or education say. Yet, for many businesses, this model is generating millions of dollars month after month.
So, what is the secret? There is no secret, but there are best practices—best practices that we can learn from some of the leading dropshippers in the world.
Ready to get inspired?
There is a viral video of Davie Fogarty where people laughed at him during graduation because he wanted to be a billionaire at a young age.
Guess who is laughing now.
Davie began his dropshipping journey with only $500, generated $800,000,000 over the years, and is now a well-known and respected entrepreneur in Australia.
After experimenting with many different products and niches, he found success in building a sleepwear brand called Oodie. From time to time, he appears as an investor on Shark Tank Australia.
Davie used to dropship
So, how did Davie succeed?
He found a product online, studied its market, and launched a dropshipping business. The particular product he sold at that time was a weighted blanket. He made $10,000 from this and then used this money to launch Oodie.
He said that the trick to dropshipping is to find a product that is not too saturated and to be early before the trend picks up.
Kevin launched his dropshipping business when he was 23 years old. He only had $3,000 in his bank account at that time, but it took him only a little over a year to make $20 million in revenue.
Now, Kevin is the CEO of Kreator Consulting, a firm that teaches entrepreneurs
He provides advice regarding the three most common mistakes of dropshippers. According to him, these are:
Kevin found success by building a brand. He is not an advocate of dropshipping random items. He also adds that you must find a deep or specific niche, find a bunch of complementary products, and be an authority in that niche.
Elif followed an approach that was very different from many other successful dropshippers. Instead of sticking to a single niche, she constantly scoured social media for products showing strong engagement and viral potential. Once she spotted a trending product, Elif would quickly build a brand and launch a one-product store around it, capitalizing on the surge in demand and fully focus on these during the right time of year, meaning:
Elif’s strategy is to properly calculate seasonality, launch a store, quickly market it, cash in, then pick the next winning product, rotating more than 20 one-product stores in a single year. Speed is her advantage.
Back in 2019, Elif worked together with the founders of Tradelle to establish a hybrid shipping model between China and Europe. Nowadays, she lives in Dubai and runs a consultancy, EA Dropshipping – for e-commerce brands.
This dropshipping duo grew so fast that even companies like Oberlo and CJdropshipping chased them just to get advice on how to succeed in dropshipping.
Back in 2018, they thought of opening an online shop, and their options were either Amazon FBA or dropshipping. They chose the latter because it was easier to set up.
They had 50 products in their first store, spent a lot of money, and failed. They had no more than ten sales. These failures taught them valuable lessons, such as:
They found success in the pet niche. With that store, they made $170,000 in three months, and it allowed them to scale and open more dropshipping stores.
Now, they have served over 50,000 customers and made over $11,000,000 in three years. Like the other dropshippers mentioned in this article, the two decided to create their own brand.
Harry Coleman is the founder of Beasts of Ecom, an online course where you can learn everything about e-commerce, including dropshipping.
Harry was and still is a dropshipper, and like many aspiring entrepreneurs, he was not born into money. His first foray into dropshipping was also a failure. He spent over $800 on his first store and never made a sale.
Now, he has at least three successful dropshipping stores with a staff of at least ten people. He also has a YouTube channel with over 85,000 subscribers.
He sold nail extensions in his first store, and this failed. He changed his approach and built a general niche store. Then, he noticed that one product stood out—pet jewelry.
Harry built more general stores and duplicated his success from the first one. He was making $1,000 to $2,000 per day, and this is when he realized that he had cracked the code.
Harry’s approach to dropshipping is simple: have a niche inside a general store. What it means is to build a general store but have a category that may stand out to consumers.
Once you have found a specific product, or groups of products that people buy, specialize in that niche. You can either create a new store or add more products to that category.
Julie is the founder of Be Activewear, a sports clothing business that uses the dropshipping model. Her being a single mother did not stop her from building a business empire.
What’s amazing about Julie’s story is that she started her dropshipping store with only $150! The thing with Julie’s approach is that she did not dropship unknown brands from AliExpress. Instead, she worked with brands and convinced them to dropship with her.
Today, her store carries multiple brands like:
If you visit her store, you will also realize that she focuses on only one thing: female clothing for sports. Lately, she has branched out to men’s wear, but this niche is merely secondary, not a priority. As of the time of this writing, Be Activewear is known to generate over $1,500,000 in sales per year.
Of all the successful dropshippers, Sebastian is the one who has amassed a following on YouTube as an e-commerce expert. His YouTube channel has over 900,000 subscribers.
He began dropshipping as a teen, and he has been in this business for years. Now, he operates a website where he teaches people how to succeed in dropshipping.
Sebastian used to work at Taco Bell, earning about $8 per hour. He discovered dropshipping, tried it, and it didn’t work.
Although he failed the first time, he found YouTubers who taught him valuable lessons. His second store made $35,000 in revenue, and this success fueled him to create another store.
At this point, he ran ads on Facebook and Instagram and learned as much as he could. His success was so phenomenal that he gave up his day job.
Now, Sebastian is one of the leading mentors not only in dropshipping but in e-commerce in general. He has over 1.2 million followers, six companies, and millions in sales.
Most of the things you will see on social media today are about the divorce of this power couple. But let us not talk about that and instead focus on their dropshipping success.
Alex and Mimi achieved financial freedom by dropshipping hair extensions. They attribute their success not to the product, but to focusing on customer experience.
They said that it is the Shopify apps that helped them reach their sales goals. In essence, their advice is to improve customer experience. Then, sales will follow.
The channel was a hit. They have over 1.4 million subscribers and have a cumulative view count of over 173 million!
The couple capitalized on their brand and, eventually, heavily expanded their business.
Sarah and Audrey met back in 2019 and joined forces to build a dropshipping empire. By the time they met, each already had her own success story.
Sarah began dropshipping when she was still studying. At the same time, she was working at a fast-food chain in France. She saw YouTube videos about dropshipping and decided to try it. Her first stores failed, but she did not give up.
Her success came about when she worked with an influencer who endorsed her products. She paid the influencer $471, and this endorsement generated over $47,000 in sales!
Meanwhile, Audrey worked at a clothing shop, also in Paris, but she was not happy—she wanted a business of her own. Like Sarah, her first dropshipping stores failed.
She did not give up. Instead, she kept educating herself. She tried again and managed to have a few sales. She kept learning until she finally found the key to success. She attributes her business growth to Facebook Ads, Google Ads, and Pinterest Ads.
When they met, they combined all their knowledge to build a brand, one that made over $2,500,000 in sales in as little as four months! Both of them are advocates of working with influencers and using the power of social media ads.
Like many dropshippers, Cole Turner’s first store was a general one. He was merely experimenting on which products would take off.
His strategy for dropshipping is not a secret: he says that you must actively search for viral products until you find one.
That is what he did, and when he made sales, he quickly scaled his business by advertising on Facebook. Eventually, he redesigned his website and turned it into a one-product dropshipping store.
Now that you have real-life examples of successful dropshippers, it is time to figure out what made them successful, so that you can replicate their strategies.
These strategies are based on interviews with these successful entrepreneurs:
Of course, these are not the only things you must do, but these are the most important, and they must be your top priorities.
How? What are the characteristics of a good product? Where do you even begin? Successful dropshippers all agree that your product must:
This process itself can take days or weeks to research for each product! Thankfully, there is Tradelle that you can rely on. Here, take a look:
Tradelle’s system does all the hard work for you. For every product, you will see the following things:
There is so much more on the product page than what is on this screenshot. It is highly recommended that you sign up for a free account now to test it!
Dropshipping is not a get-rich-quick scheme. It seems like many people have this notion, and when they fail, they call dropshipping a scam.
You also need to be thirsty for knowledge. All the things you will learn from gurus online are merely the basics of the business. Your real learning will come from your failures.
Growth can only happen when you keep an objective mind. Find out what caused the failure, learn from it, and rebuild. Then, you need to spend a lot of money on ads. No one will find your website through organic reach. After all, not a lot of people search for stuff with the keyword “expensive.” It is on you to find a way to reach wealthy clients and customers.
You must build your store for the convenience of your shoppers. Below are some things to focus on:
Any store built on Shopify or WooCommerce is pretty much bare. Yet, there are thousands of apps or plugins you can use to improve your store’s appearance and user interface.
The classic way of dropshipping is using AliExpress as your supplier. It does the job, but it’s very slow, expensive and comes with many legal issues if your reside or sell to Western countries. This issue is even larger if you sell to the United Stated or countries that are part of the European Union. Lack of proper certifications, proper invoices and other bureaucratic requirements can lead to trouble quickly.
Use trusted suppliers that communicate in proper English, understand invoicing requirements so you can properly book your fulfillment costs as business expenses, are able to provide certifications (such as CE for the EU) that are valid and not fabricated in photoshop and, ideally, integrate their services with Shopify.
If your supplier only communicates via WhatsApp, can’t formulate proper English sentences or blatantly uses ChatGPT and doesn’t understand how invoicing works, chances are you’ll have trouble with returns. The best way is to use a fully integrated supplier such as Fulfillment by Tradelle.
Is there a wrong niche? Don’t all niches work?
Any niche that you are not adequately knowledgeable about is the wrong niche. To choose the right niche, ask yourself:
While all niches have a market, some niches won’t work because they are not your forte. No matter how passionate you are about a niche, keep in mind that knowledge triumphs fashion.
It is not only the product you have to research, but also the market. Some dropshipping niches have a small market, and some have a high demand but are also highly competitive.
Product and market research means you must:
You do not need to do the research manually because Tradelle does it for you. All you need to do is browse through the products and decide.
See this screenshot:
This is only a few of the important data you can find on Tradelle. As you can see, the charts give you visibility about a product’s seasonal demand, competition count, and regional interest. These, plus the other details on this page, can help you make an informed decision.
If there is a common denominator among the most successful dropshippers featured in this article, it is that they all failed and learned from their failures. In addition, it also took a while for them to succeed.
The most common unrealistic expectations of dropshippers are:
Starting a dropshipping business is indeed easy. A few clicks here and there, and you are done. However, marketing is a tough nut to crack. You must spend a lot of energy to learn how various advertising networks operate.
Apart from advertising, you need to learn:
Dropshipping is not passive income, as some others think. You need to be actively involved with your customers to succeed. For one, it is you who has to communicate, answer queries, etc.
Marketing has many facets. These include:
There are so many dropshippers who go to online forums to ask why they are not making sales. If you take a look at their stores, you will think that it was created by a 5-year-old.
It is also not uncommon for a dropshipper to slap together some images, use them for an ad, and call it a day. And then they wonder why they do not get clicks, let alone sales.
As far as marketing goes, you need to study these things:
Reading may not be enough. Watching YouTube videos can get you there, but nothing will get you ready as well as the upcoming Tradelle dropshipping course.
Beginner dropshippers typically want to fill their stores with lots of products. After all, this should give customers more products to choose from.
This usually backfires. The more products you have, the more disjointed your store will look. This, of course, sends the signal to the customer that he is looking at an unprofessional store.
Some dropshippers sell only one product. This may sound counterintuitive, but it does work. The reason is that there are no distractions—just one product, and the customer has decided to buy or not.
This is not to say that you must not import many items into your store. But if you do, you are better off importing items of a similar nature. If it is a kitchen store, sell kitchen products only. The worst thing you can do is to try to look like Amazon—not only will you get overwhelmed, but your customers will also get confused.
The most successful dropshipper is probably someone anonymous, enjoying their wealth. However, the most successful publically known dropshipper is probably Davie Fogarty. He made over $800 million.
The most profitable dropshipping business is a niche store because you can target a specific group of people with specific demands.
Tradelle is the best company for dropshipping because you will get everything you need to succeed in one system.
There is no single answer to this. Every product has the potential to become a winner. If you need guidance on this, find out more in this blog post: 15 Best Ecommerce Niches That Can Boost Your Store Sales
Success in dropshipping is no simple matter. Even the best of the best failed in their first few stores. At that time, they did not even have software systems like Tradelle, but you now do, so this reduces your risk of failing.
Sign up now for a free Tradelle account. This free account will give you access to tons of products, analytics, and calculators, all of which play a critical role in your success!
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